The truth behind automated Forex trading

Isn’t it great to receive good returns by doing practically nothing? Isn’t it great to set up the program that can trade 24/7 and generate good income for you? The idea behind Forex robots or EAs (Expert Advisors) is that computers can do some work more efficiently and without typical human errors. Needless to say that robots never feel tiredness and they can work 24 hours a day 7 days a week. The big question is, will you trust a robot when it comes to your investments? Let’s take a closer look at automated Forex trading robots!

Forex automated systems come as a good idea for novice traders. Statistics says that the overwhelming majority of Forex beginners have the unfortunate experience with their first FX trades. While most novice FX traders cannot boast with great accuracy and power, Forex robots can outperform humans when reading and analyzing details from FX charts. These systems are supposed to take all the guess work out of Forex trading. All you need to do is set up the program and watch your money pour in your account. It’s pretty exciting in theory, but in practice it may be a bit different.

EAs are mostly based on mathematical formulas. They trade in accordance with mathematical algorithms and the good thing about it is that they will never fall victims of market psychology. They can trade in any market conditions without emotions, tiredness and boredom. They can eliminate human errors associated with the times of market uncertainty. EAs will trade logically – by analyzing the trading signals, they can determine whether the deal is worth it or not. Forex robots can monitor the market 24 hours a day. In view of the fact manual trading is a time-consuming process, FX robots let traders do other things while the system monitors the market and does the analysis. In addition to that, robots have an obvious mathematical advantage in analyzing the trading signals. From this point of view, FX robots can be much more efficient than humans. But Forex is not just about calculations and graphs, it’s essential to understand how this market works and what forces move this market.

One of the main drawbacks of these systems is their inability to adjust to the changing market conditions. Even though these robots are advertised as the systems that can win the trades in your absence, it doesn’t mean that EAs don’t make mistakes that can lead to money losses. It’s really hard to predict price movements on this market. It’s a liquid market and it’s all about unpredictability. If you are not a fortune teller, you can hardly know for sure how the market will react in the nearest future. You can only guess when it comes to forecasting price movements.

Another drawback of EAs is that most of them are limited in what they can do. Some robots can trade only a particular currency pair and if you want to change some parameters, there’s no guarantee that you will get favorable results. When you start trading with a Forex robot, it’s a robot that takes entire control.

If you want to buy a robot, take your time to do some research as the market overflowed with these systems due to their increasing popularity. It’s true that Forex robots that work do exist, but there are also tons of bogus robots you can hardly take advantage of. When choosing an automated FX robot, be sure to know what makes this robot works. The cases are not rare when novice traders buy a robot, start trading it with demo accounts and everything goes well. It gives them confidence and they start trading their money with EAs. But once something wrong happens, they can hardly explain why it happened and why this system appeared to be ineffective.

All in all, Forex robots can be a good choice for novice traders as well as for experienced traders who want robots to continue monitoring and analyzing the market signals in their absence. One of the most frequently asked questions is whether Forex automated systems can cause a money loss. No matter how great this or that trading system is, it can cause a money loss. There’s no perfect Forex robot, and if such trading system does exist, no company would reveal the system that can generate high returns in autopilot.